It's true, the rich are getting richer and...

[deziloooooo]

A little article just put up...the wealthu have quadrupled in the past few year and the rest of us...well read for your selves , and the Bush tax cuts , by being allowed to expire would have made them suffer so much....as far as helping reduce the deficit if applied to...hell better to cut the oil allowence for the needy...
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news.yahoo.com/s/yblog_thelookout/20110223/ts_yblog_thelookout/separate-but-unequal-charts-show-growing-rich-poor-gap
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Separate but unequal: Charts show growing rich-poor gap

By Zachary Roth
Wed Feb 23, 5:13 pm ET

The Great Recession and the slump that followed have triggered a jobs crisis that's been making headlines since before President Obama was in office, and that will likely be with us for years. But the American economy is also plagued by a less-noted, but just as serious, problem: Simply put, over the last 30 years, the gap between rich and poor has widened into a chasm.

Gradual developments like this don't typically lend themselves to news coverage. But Mother Jones magazine has crunched the data on inequality, and put together a group of stunning new charts. Taken together, they offer a dramatic visual illustration of who's doing well and who's doing badly in modern America.
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{click on the link to go to the article}

[Value Buy]

Dezi, I am far from "rich". More like, "a little to the right", but working on getting rich.
Just finished my spread sheets, for last year, checking investments, dividends, etc. Things are looking up. As far as my job, same oh, same oh, about the same, but, outside of tough quotas to make a decent bonus, I am improving a little there as well.
It is all about investment, with little steps. You have to start young, and leave the money grow, reinvesting dividends and interest. Most Americans will never make enough money to live the real good life on their work jobs, but everyone has the ability to put some money to work for them no matter how low their pay structure is, and that is what can make a difference for everyone, over the longterm.........
Life is like a box of chocolates, you just cannot eat them all at once. You always want to save a few for later.
And that is all I am going to say about that.

[deziloooooo]

Heres all the charts courtesy of "Mother Goose"
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motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph
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[Savoir Faire-Demogague in NJ]

My net worth has skyrocketed in the last 5-6 years.

What is interesting is the that last four years, the fed govt has been concentrating on growing the low income/poverty demographic.

[floridayankee]

Feb 24, 2011 10:10:53 GMT -5 Savoir Faire-Demogague in NJ said:

My net worth has skyrocketed in the last 5-6 years.

Same here SF. But I remember on the old board, people argued more stimulus money needed to go the the "poor people" because they are more likely to spend everything rather than save it like the evil "rich" person.

Then people are outraged that the "rich" are getting richer. Really, it's not that hard to figure out, is it?

What is interesting is the that last four years, the fed govt has been concentrating on growing the low income/poverty demographic.

Correct....despite increased entitlement spending, the problem is getting worse.

Do the math here folks....

[Deleted]

You mean despite all of the gum flapping that the rich bear too much of the tax liability they keep getting richer and richer and the poor do not...

Unbelievable.

[handyman2]

The one thing I learned early was to put your growth money into things you really understand how it works and be patient. I see people jump into investments on some whim or friends advice knowing little about how the system works, no research or study and soon lose everything. Old saying if it is to good to be true it most likely is.
As an example a few years ago I had several friends who invested their 401-K funds in supposedly high yield returns and for a couple years kept telling me how much growth they had made. My response is it may be high yield but also high risk. I just plodded along at that time getting 8 to 9 percent on mine. Suddenly they lost it all including the principal and had to start from scratch.
It starts with the first nickel and patience. there are few schemes to instant wealth but to many want it all instantly, a sure sign of failure.

[Deleted]

Karma archie...

[AgeOfEnlightenmentSCP]

I saw this coming years ago. What we are witnessing is the end of an era. There just aren't going to be that many people with traditional "jobs" as we've come to know them. The idea of working for one company for decades, and then having that company take care of you the rest of your life died in the 1980's.

The idea of "benefits" started to fade in the 1990's.

What we're seeing now is the collapse of the whole notion of a "job".

The future I see is one where those educated / skilled workers that remain on the "job" are going to be part of a labor pool that works for a third party and gets farmed out to numerous employers on an as-needed basis. Those who are the quickest learners, who speak multiple languages, and who are the most versatile will be paid the most. Those slowest to adapt, and more rigid will get paid the least or will join the 20% to 30% of the population that is long-term chronically unemployed or underemployed.

The rest, and I dare say the majority, will be contractors and sub-contractors. They will work at many jobs, maybe even in many different fields over the course of their lives. Most of the work in the United States will be knowledge work. Labor will continue to be outsourced, though there will be room for independent contractors with strong technical ability to keep mostly automated manufacturing systems operational. To paraphrase one futurist, we are headed towards a world in which a factory will be staffed with one man, and one dog. The dog will be there to keep the man from touching any of the equipment.

The bottom line: We succeeded. We simply do not need as many people working as we once did. It has nothing to do with the economic downturn- though the recent downturn has helped to highlight the reality: there are/were a whole bunch of useless people taking up space in the workforce. Since they weren't and aren't needed, they won't be going back.

I've been predicting this situation for years. I used to fight about it with people on YM. I used to tell people that IT workers are the blue collar workers of the future, their wages are going to correct and drift down to and below the median, and with the exception of a select highly skilled few, most IT work would be outsourced because with the internet there's simply no need to pay someone $90K a year for a job that can be done for $9000 a year. I used to say not only can everyone work for themselves, but everyone does and will work for themselves. W-2 is nothing but an administrative distinction created by our tax code, that it is not necessary as there are other forms- like the 1099, and they would be substituted as hiring became more expensive, more regulated, and more frought with liability than it already is.

The fact of the matter is I don't have to argue my case anymore- just watch and learn.

[AgeOfEnlightenmentSCP]

Feb 24, 2011 10:39:13 GMT -5 handyman2 said:

The one thing I learned early was to put your growth money into things you really understand how it works and be patient. I see people jump into investments on some whim or friends advice knowing little about how the system works, no research or study and soon lose everything. Old saying if it is to good to be true it most likely is.
As an example a few years ago I had several friends who invested their 401-K funds in supposedly high yield returns and for a couple years kept telling me how much growth they had made. My response is it may be high yield but also high risk. I just plodded along at that time getting 8 to 9 percent on mine. Suddenly they lost it all including the principal and had to start from scratch.
It starts with the first nickel and patience. there are few schemes to instant wealth but to many want it all instantly, a sure sign of failure.

My long term growth money is in the S&P 500 index. I read someplace that 84% of mutual funds fall short of the S&P 500, so I reasoned that I couldn't do better than 84% of fund managers unless I wanted a full time job managing my retirement account. Over the long term, the market is going to do what it's going to do, and you might be able to select a few break out stocks here and there, but it's FAR more likely you'll pick dogs.

I know that experienced traders here can do better- but I'm talking about people like me. I'm an expert real estate investor. I can do better than buying a primary residence, paying on it for 30 years, and letting it "go up" with the market appreciation (and inflation). But I'd hardly advise it as an investment strategy-- so, I can understand what some of you might say to this.

For me, however, I don't have the time to worry about it on a daily basis and the S&P index is the best fire-and-forget investment for me at this time.

[AgeOfEnlightenmentSCP]

What every article on income inequality in America refuses to acknowledge is class mobility. The rich are getting richer, but the poor are also getting richer. Rich has little to do with income anyway. In fact, years ago the book, "The Millionaire Next Door" established that some of the "richest" (measured in income) were also some of the least adept at growing net worth. Income is lifestyle, net worth is security. Often the lower the lifestyle, the more secure a person can become; and a large income is often too tempting.

[BeenThere...DoneThat...]

...we've all heard that "love is a verb" and, imo, "rich" and "poor" follow suit... so, of course the rich get richer and the poor ger poorer, no matter the market/political forces of the day...

[Savoir Faire-Demogague in NJ]

The fact of the matter is I don't have to argue my case anymore- just watch and learn.

100% right on target. The Gartner Group released a study last year that supports this. They also pointed out the biggest growth segment in the job market in the US is for knowledge workers.

[floridayankee]

Feb 24, 2011 10:33:24 GMT -5 ArchietheDragon said:

You mean despite all of the gum flapping that the rich bear too much of the tax liability they keep getting richer and richer and the poor do not...

Unbelievable.

What's so unbelievable about it Archie? Personally, if I am forced to pay more in one area, I cut back in others. It's called common sense, not magic.

[handyman2]

PBP: You are exactly correct. To day I own a small company with skilled people where we install and assemble automated systems around the south. I have retired twice and the manufacturers of the equipment keep calling. They pay well but expect well trained specialists to do the job. You are going to see more of this concept in the future.

[burnsattornincan]

Gentlemen, I think you are drifting way "off topic" and have probably confused Mr. deziloooooo beyond a hope to respond. He only understands rehashed layman's reporting such as "wage gap widening", "billion dollar corporations pay no tax", ect. ect.

[jkapp]

"I saw this coming years ago. What we are witnessing is the end of an era. There just aren't going to be that many people with traditional "jobs" as we've come to know them. The idea of working for one company for decades, and then having that company take care of you the rest of your life died in the 1980's. "

People also used to save for years to put down 20% or more on a house.

People also used to pay small amounts of money over a period of time on big ticket items (called Layaway).

People used to only buy those things they could afford to buy, and rarely did they ever subscribe to large payment plan subscriptions (see cell phone, cable tv, internet, etc).

People used to actually save their money, and make sure their lifestyle choices allowed them to save that money, in order to build a little wealth for themselves.

A lot of things have changed about society...but I would argue people's lifestyle choices tend to make the biggest differences.

[Value Buy]

As my stock market portfolio grew over the years, I had to start doing quarterly payments to the Federal and state Government to cover my profits, and increasing amount of dividends, until the last couple of years.
Now, after big gains last year, and some good profits this month, I might have to start doing it again.
My complaint, is the old one-why should we be taxed on the same money year after year? Once the money is taxed the first time, the Fed's should not be able to tax it again and again. into infinity.......
I can see how the rich get richer, but damn it, it is not their fault, and should not be held accountable for their actions, unless it was ilegal.
The problem now, is the "leftwing" is like my wife. (with apoligies to my wife)

"What is her's is her's, and what is mine, is her's also", and do not forget it......

[Deleted]

There is this thing called" compound" interest. If you live within your means you can make money from your money. If you don't and you borrow yourself into debt than you lose money. It's a pretty simple concept.

[deziloooooo]

Feb 24, 2011 11:18:23 GMT -5 burnsattornincan said:

Gentlemen, I think you are drifting way "off topic" and have probably confused Mr. deziloooooo beyond a hope to respond. He only understands rehashed layman's reporting such as "wage gap widening", "billion dollar corporations pay no tax", ect. ect.

I am a bit confused here Burns...I was the messenger..I saw the article, read it, saw the graphs , read them, figured , mmm, interesting , I have some friends who might be interested in this information, let me bring it to their attention, let them prove it is not so, or if it is, it's fine with them, possible they believe they too will some day be where these folks are and then they to can so cash in.

I get from your post you believe in . "Shooting the messenger " if the message isn't to your liking.{sigh} Thank g-d for the distance and the anonymous locations the web afford us.

I don't believe I commented so much on the material presented.
I do, as most know, have a hard time understanding why so many her were for th continuation of the Bush Tax cuts, I gave a pass on the lower one, the $200,000/250,000 one, but on the big one..a million and over, you know that is not on net worth, just income, people who earn $1,000,000 per year..a few points higher on income over the $1 million{remember I gave in on the lower one, personally think $750, 000 would be ok }

Would allowing those cuts to expire solve all out problems? Of course not , but sets a tone, takes some criticism off the wealthiest..ok paying more , now leave alone for a while, and they are scrambling to find every $ of savings they can,{not yet on entitlements yet, they are coming I believe}
You who argued so vehemently in letting the cuts stay, like you were the defenders of the Alamo, do you know how silly you sounded, especially after reading these charts yet you still argue and defend like the last bastion of defense.

Some times when faced with certain facts, it is proper to say,

"mmm, ok , possible I was wrong on that one..they have a point, in this case, WOW the wealthy are doing great, if the figures /charts are off say 35 %, still this is nuts. Yes I am doing well BUT nowhere close to this well..I guess in this one, I was mistaken. It's not fair to the wealthy but as one has said..what in life is always fair."

[deziloooooo]

Feb 24, 2011 14:41:43 GMT -5 @xmascookie said:

There is this thing called" compound" interest. If you live within your means you can make money from your money. If you don't and you borrow yourself into debt than you lose money. It's a pretty simple concept.

In reading a lot of the posts here, you all are correct. My days of acquiring wealth, they are gone. I am retired ...and in my working days, I made a fair income , but I was a investor..mostly for me in mutual funds..a little stock itself, and by leaving the dividends to repurchase and steady, trying to pick good funds, did well and also got killed.
2000..not so bad..I knew 25% return and up was nuts.. a year and a half before the bust I started moving to steady but safe..and cursed myself as the returns still were great but I wasn't participating, but resisted the temptation and stayed out..so on that one I came out smiling. less so this last but now, doing OK.

As far as compounding..your right..

I once , actually twice, bought a annuity, a payout on a pension that a company I was working for that was self financing, found to be illegal, so had to close it and disburse the funds. My return was $5000 plus, not a lot but a lot at the time and had to invest quick or pay taxes so rolled over to a Annuity, paying at the time, 12%, think it was around Jimmy Carter time, naturally return dropped as interst rates dropped but have averaged about 5 %, anyway, and then again a year or so later another $2500...forgot about them.

With the compounding year after year..one is worth now in the $50's and the other about $22 thou..all from compounding..that's how the wealth old timers do it, clip coupons..LOL

I was lucky. Over the years I have purchased 5 homes...some rentals too, still have those, that is where I made a good chunk of my what ever...

Agree with all of you , invest steadily..keep credit to a minimum, enjoy life but play smart...

[Deleted]

dezi.....in regards to post #19:

You say that you think it's fair to keep the "Bush tax cuts" for those making under $250k but not for those making over that. Why? Obviously the majority of richer people in this country pay far more in taxes than poor or middle class people even if it may be a smaller percentage due to investments and tax deferred accounts.

Putting it this way: If a "poor" person pays 15% taxes on $26500 then they are paying $3975 in taxes. Now, if a "rich" person is paying 10% taxes (after tax deferred investments and the like) on a yearly income of $275k then they are paying $27500 in taxes. They are paying far more in taxes even at a "hypothetical" lower rate.

That's the part I don't get about people bashing the "rich" for being rich. The "rich" tend to save more money (because they can) and invest it, but lower income people can also do these same things at a smaller level to get ahead. Being responsible with one's money is a key factor in growing wealth. If you piss it away on beer & cigarettes, or cable and an IPhone, or whatever combination of things, then it's likely to keep you in the "I'm poor and the rich should pay!" mentality.

[Savoir Faire-Demogague in NJ]

That's the part I don't get about people bashing the "rich" for being rich. The "rich" tend to save more money (because they can) and invest it, but lower income people can also do these same things at a smaller level to get ahead. Being responsible with one's money is a key factor in growing wealth. If you piss it away on beer & cigarettes, or cable and an IPhone, or whatever combination of things, then it's likely to keep you in the "I'm poor and the rich should pay!" mentality.

We all witnessed what happens when the rich and wealth start losing money. NY State and NYC each get 20% of their tax revenues from the financial sector. During the downturn and still today, both govt entities are in dire straits...and making up the short fall by levying taxes, fees and fines on the middle class.
But I digress.

[deziloooooo]

Feb 24, 2011 15:56:45 GMT -5 @financialtexan said:

dezi.....in regards to post #19:

You say that you think it's fair to keep the "Bush tax cuts" for those making under $250k but not for those making over that. Why? Obviously the majority of richer people in this country pay far more in taxes than poor or middle class people even if it may be a smaller percentage due to investments and tax deferred accounts.

Putting it this way: If a "poor" person pays 15% taxes on $26500 then they are paying $3975 in taxes. Now, if a "rich" person is paying 10% taxes (after tax deferred investments and the like) on a yearly income of $275k then they are paying $27500 in taxes. They are paying far more in taxes even at a "hypothetical" lower rate.

That's the part I don't get about people bashing the "rich" for being rich. The "rich" tend to save more money (because they can) and invest it, but lower income people can also do these same things at a smaller level to get ahead. Being responsible with one's money is a key factor in growing wealth. If you piss it away on beer & cigarettes, or cable and an IPhone, or whatever combination of things, then it's likely to keep you in the "I'm poor and the rich should pay!" mentality.

Actually I had said I question the $200,000/250,000...being allowed to expire..more in tune to the $1 million and above, though if we get into a discussion, would propose that some one earning a income of $750 thou per year could also afford to pay the bit more...
Are you in those categories?
Lets say you are. Say your income is over $1 mill per year, say over $750 thou a year..the charts and graphs show you are doing fine..you are paying taxes but they have been a lot worse, you are growing your wealth way above the norm..if you not then get ab better adviser, and yes it is unfair but even so, you will more then able to pay the higher rate , not that large when you consider what you are earning..your over all rate is low ..

Yet you are NOT in that category yet your still like the guys at the Alamo defending away.. but in this case, it makes no sense..your defense is wrong and yet you continue to defend rather then , see a suggested response above..there I am right ..your not.

What also has to be considered is the times we are in..were the government is now. Two wars, granted one almost over but still a drain on the economy and no taxes set to pay for them..seems to be the way we fight oday...help is needed and to alloww those cuts to not expore, especially on the big one...mashoogana.

[floridayankee]

Feb 24, 2011 15:56:45 GMT -5 @financialtexan said:

dezi.....in regards to post #19:

You say that you think it's fair to keep the "Bush tax cuts" for those making under $250k but not for those making over that.

It's funny what some consider "fair", isn't it?

[floridayankee]

Feb 24, 2011 16:07:24 GMT -5 deziloooooo said:

Are you in those categories?

immaterial. Fairness does not change at different income levels.

you will more then able to pay the higher rate , not that large when you consider what you are earning..your over all rate is low.

You don't know that. Maybe he has large liabilities to go with that large income.

Yet you are NOT in that category yet your still like the guys at the Alamo defending away.. but in this case, it makes no sense..your defense is wrong and yet you continue to defend rather then , see a suggested response above..there I am right ..your not.

The AMT will trap an estimated 35 million people this year when it was originally intended to target 155. Now we can't end it, because like a downtown crack whore, government is hooked on the money it sucks out of the wallets of the evil, "rich" people.

Why do we always seem to forget the slippery slope of history when it's convenient to?

[mmhmm]

This is a trend that's been escalating since this country was formed, Dez. It took a quantum leap during the 80s and is continuing to widen the gap between the rich and the poor at a very quick pace. Yes, individuals can dip into this growing wealth, but the ones who really benefit are those at the top of the food chain. That will continue to be the case, until those who are realizing gains from it now, but aren't amongst those elite few, will also feel the squeeze. After all, if you've milked all the cows but a few, you're going to milk the hell out of those few, eh? Whether we like it, or not, that's what capitalism is all about.

[Savoir Faire-Demogague in NJ]

Yes, individuals can dip into this growing wealth, but the ones who really benefit are those at the top of the food chain.

What is interesting about wealth and income in the US, is that both are highly mobile. Not only can people with big incomes and large stashes of wealth move about the country quite easily to avoid high taxation regions....but those who are in the top tier of wealth and income change rapidly. Many in the top income and wealth levels were not there a mere 10 to 15 years ago.
My thoughts are in 10 years the wealthiest and highest paid Americans will all be new faces.

[deziloooooo]

Feb 24, 2011 16:30:17 GMT -5 floridayankee said:

Feb 24, 2011 16:07:24 GMT -5 deziloooooo said:

Are you in those categories?

immaterial. Fairness does not change at different income levels.

You don't know that. Maybe he has large liabilities to go with that large income.

Yet you are NOT in that category yet your still like the guys at the Alamo defending away.. but in this case, it makes no sense..your defense is wrong and yet you continue to defend rather then , see a suggested response above..there I am right ..your not.

The AMT will trap an estimated 35 million people this year when it was originally intended to target 155. Now we can't end it, because like a downtown crack whore, government is hooked on the money it sucks out of the wallets of the evil, "rich" people.

Why do we always seem to forget the slippery slope of history when it's convenient to?

With all that you said..and I DID consider..sorry friend, your not convincing me...the top ones..should have expired, we can discuss the lower ones, the 200/250 thou , my idea of that being moved to $750,000.... may have obligations, income of 1 mill plus per year, remember not net worth, I am sure they do, 5th vacation, another car, re do the pool, vegas here I come...I am sure , many obligations, and possible, one of them just might have to be post poned till next year..personally, I doubt it, but grant you , maybe.

[Deleted]

No... the top tier actually does not change that much, and generationally, we actually don't have a whole lot of mobility... even though there is the perception that we do...
www.oecd.org/dataoecd/2/7/45002641.pdf

A few noted innovators do manage to break out... but they are not the norm...

And it has not been escalating since the beginning... it peaked right before the great depression and then dropped and for many years was almost flat, before the gap begain widening again... The slate series is very good at going into these details... as someone noted on the Your Money thread on this topic.